Get the inside track on the media and government

• ← Turnbull and authenticity
• More about Puff the Magic Malcolm →

For the Chinese, 2016 is the ‘Year of the Monkey’ but I think in Australia it may well be the year of the union — although not in a positive way. As it is an election year, and in the light of the Trade Union Royal Commission (TURC) report in December, we can expect the Coalition government to have a lot to say about unions during the year. Turnbull, in releasing the TURC report, has already indicated that he will make union ‘corruption’ an election issue if his legislation to implement the TURC recommendations, including the reintroduction of the Australian Building and Construction Commission (ABCC), does not pass parliament.

Unions of course will not take this lying down. The ACTU responded to the release of the TURC report by stating:

The ACTU rejects any accusation of widespread corrupt, unlawful behaviour in the union movement. We take a zero-tolerance approach to unlawful conduct, whether in the union movement or elsewhere. Isolated instances of unlawful conduct must always be referred to the police. Unions stand united to ensure any individuals convicted should feel the full force of the law. There is no place for crooks in our movement.

The ACTU welcomes sensible discussions about best practice governance. Prime Minister Malcolm Turnbull must allow space and time for these discussions to occur. This report should not be used to rush legislation that removes employee rights.

It also saw that the TURC report and a Productivity Commission review, which recommended a reduction in penalty rates, were related:

It is clear from the timing of the Royal Commission’s report that these two reports were always designed to attack the rights and pay of working people and undermine unions who defend their rights and pay.

We do not often see issues discussed in terms of workers’ rights in Australian media but the International Trade Union Confederation (ITUC, representing 180 million workers world-wide and currently led by former ACTU president Sharan Burrow) has rated Australia as having ‘regular violation of rights’. This appears in the ITUC Global Rights Index which tracks legislation that limits workers’ rights and actual incidents of violations: these are tallied together and each country then given a score between 1 and 5, where 1 represents rights being generally guaranteed and 5 being no guarantee of rights.

Australia’s score of 3 means:

Governments and/or companies are regularly interfering in collective labour rights or are failing to fully guarantee important aspects of those rights. There are deficiencies in laws and/or certain practices which make frequent violations possible.

By comparison, the USA scores 4 (systematic violations of rights) and Brazil 2 (slightly weaker collective labour rights than those with a rating of 1 but certain rights have come under repeated attack).

Interestingly, however, the USA, since a 1977 Supreme Court decision, has had a rule that public sector workers who benefit from union representation — such as higher wages and improved conditions — can be made to pay their fair share to the union and a number of states did introduce laws to enforce this. In other words, in the land of ‘free enterprise’ the union basically can claim a ‘fee for service’. (That is currently being challenged in another court case, with a ruling expected in June 2016).

In Australia, governments across the country have introduced ‘fee for service’ models into all sorts of public services but refuse to recognise it in respect to union activities and are doing as much as they can to undermine unions and workers’ collective rights. In fact, ‘fee for bargaining services’ is explicitly made illegal in Australia, other than union membership dues — but because a person cannot be made to join a union, it is possible in Australia to have ‘free riders’ who benefit from union bargaining without making any contribution. (The ‘free rider’ effect was what led to the original US Supreme Court decision.) In that regard, the ILO (International Labour Organisation) has found that in Australia, although less than 20% of employees are union members, 60% of employees work under collectively bargained conditions.

The ITUC provides quite a long list of the problems in Australia — note that these relate to a period up to early 2014: the link is here but also click on ‘In Practice’ to see the rest of the list. It includes:

• employers have a discretionary right to refuse to bargain with representative trade unions
• prior authorisation or approval by authorities is required to hold a lawful strike
• restrictions with respect to the objective of a strike (eg economic and social issues, political, sympathy and solidarity reasons are not allowed)
• authorities’ or employers’ have power to unilaterally prohibit, limit, suspend or cease a strike action
• employers are using delaying tactics to avoid collective bargaining
• individual agreements are undermining collective bargaining
• many employers (particularly in the mining sector) do their best to frustrate trade union activity

Some employers try to avoid bargaining with a union and the ITUC assessment provides one extreme example:

The employer went to great lengths to avoid bargaining with the union by closing the mine for three months (to avoid certain transfer provisions in the Fair Work Act), hiring a small number of employees (21 from a required total of over 400) who were thought to be non-members, and negotiating an agreement directly with the employees and excluding the union. The employer essentially forced the employees to relinquish their rights to be represented by the union by having them appoint themselves as their own representatives for the bargaining.

In America, and to some extent in Australia, this is done under the banner of the ‘right to work’. That is a neo-liberal banner that claims each individual should be free to choose the manner and conditions of their work and not be ruled by external influences — like collective bargaining and union involvement. It was an idea that was originally abandoned in Australia in the Harvester decision in 1907 when Mr Justice Higgins determined that:

The provision of fair and reasonable remuneration is obviously designed for the benefit of the employees in the industry; and it must be meant to secure to them something which they cannot get by the ordinary system of individual bargaining. [emphasis added]

Since the 1970s, however, individual bargaining has eased its way back towards centre stage.

The attempts to reduce workers’ rights and working conditions, and remove unions from the equation, has been reflected in agreement negotiations in the Australian Public Service. Some public servants have not had a pay rise since 2014 as, at the direction of the government, public service departments delayed negotiations or included proposals that staff could not agree to. One interesting approach was to offer to maintain conditions but to remove them from agreements and make them ‘policy’. In December 2015, the CPSU (Community and Public Sector Union) warned staff in the agriculture department that:

If your rights are taken out of your agreement and put into policy, they can be removed or changed at any time. In some agencies that have voted yes this is already happening!

Just weeks after a small majority of workers said yes in DSS, management moved to change their consultative arrangements in a way that meant union delegates were no longer being consulted.

Effectively taking unions out of the industrial relations loop is part of the ‘right to work’ approach and has been pursued by the Howard, Abbott and now Turnbull governments. Turnbull may cloak it in fine words but the intention of his proposed legislation in response to the TURC report is to further erode the influence of unions.

All this may not mean much to many in the electorate but there are 1.6 million union members in Australia: that is the ABS figure for 2014, whereas the ACTU claimed late in 2015 that the membership in its records suggested a figure of 1.8 million. Either way, that is certainly the lowest level of union membership in the workforce since detailed records have been kept: it has come down from about 40% of the workforce in 1992.

While the official ABS figures suggest union membership is down to 14% of those in employment, that is slightly misleading because the ABS counts owner-managers of both incorporated and unincorporated enterprises and many, if not most, of those would not be likely to join a union in any case. Union membership only for those who are employees is somewhat higher at 17%, or 19% if we use the ACTU figure.

As at 30 September 2015, there were 15,259,399 enrolled voters in Australia. Union membership, therefore, represents between 10.5% (using the ABS figure) and 11.7% (the ACTU figure) of voters — which gives unionists about half the electoral power of those aged 65 and over, who represent 21.8% of the electorate (which also gives a clear indication why the ‘grey vote’ is so important). Even so, about 12% of the electorate is a figure that cannot really be ignored and especially so if one considers that there may be influences to non-union members in a person’s family or circle of friends.

The problem is that union members are not evenly distributed across electorates. Although I do not have actual figures, I suspect they are disproportionately represented in what are strong or safe Labor seats which is why the government believes it can launch its union attacks. It knows the attacks may cost votes in Labor seats but that will make no difference to an election outcome. It is hoping that by bashing the unions, it can gain enough votes in ‘swinging’ seats to hold on to government.

The government, however, should note that, as reported in The Guardian, Essential Research found in 2015 that 62% of Australians believed unions were important (that figure had increased since 2012) and 45% believed workers would be better off if unions were stronger (compared to 26% who thought workers would be worse off). Given those figures, government attacks on unions can backfire if that 62% begin to believe that the government is going too far — as they did when Howard introduced WorkChoices.

Before people start believing the government’s rhetoric regarding unions they should consider some of the facts, even as revealed by the ABS which by no means can be considered a propagandist for unions. The median weekly income for employed persons in a union in 2013‒14 was $1,200 compared to $960 for non-union employees (and the mean was $1,295 compared to $1,162). Overall 24% of those in employment did not have paid leave entitlements: while this includes the owner-managers, it would also include some casual and part-time workers. Of union members, however, 91% had paid leave entitlements.

In America, workers have no nationally mandated paid leave: it is entirely a matter for employers and employees and to some extent state and local regulations. It was found in 2006 that workers who were union members in the USA received on average 13 days paid leave and 8 paid public holidays while non-union workers received 9 days paid leave and 6 paid public holidays. Given our experience in Australia, it is difficult to comprehend that the amount of leave a worker is entitled to can be dependent on whether or not one is a union member.

Even with all the changes that have taken place in Australia, the Fair Work provisions include ten nationally mandated minimum standards including:

• a standard 38-hour week
• four weeks paid annual leave
• ten days paid personal/carer’s leave each year and two days paid compassionate leave for each eligible bereavement
• long service leave
• a right to request flexible working arrangements

While these conditions may now be legally mandated, they did not arise out of the blue nor out of the goodness of heart of employers or government. Those conditions, now accepted as the norm, were fought for over many years by unions. If the role of unions is further diminished in coming years, where will improvements in workers’ conditions come from in the future?

Turnbull may think he is on a winner bashing the unions but the effectiveness of his campaign will depend on two crucial external factors:

• the effectiveness of any union campaign against the changes he proposes (they did, after all, mount an effective campaign against WorkChoices), and
• whether the 62% of Australians who support unions perceive that he is going too far (the unions will certainly do their best to foster that view)

So his task will not be easy and can unravel and backfire on him and on the Coalition’s electoral chances. Despite the risks, I believe Turnbull and the Coalition will persist with it because it is consistent with their neo-liberal economic agenda and has the support of their big supporter — big business.

• ← Turnbull and authenticity
• More about Puff the Magic Malcolm →

---

---

---

FEATURED VIDEO

---